According to a report in the Wall Street Journal, the country’s banks are expecting to accrue as much as $12 billion this year, simply by helping homeowners to refinance their mortgages through the Home Affordable Refinance Program.

HARP underwent some serious changes late last year, as the government strove to encourage more banks to agree to refinance the mortgages of homeowners who had slipped underwater. The idea was that homeowners would be able to take advantage of record low interest rates and benefit from a serious reduction in their monthly repayments.

However, while this has happened to an extent, homeowners often feel compelled to refinancing with their existing lender, as approaching another lender means there are dozens more hoops to jump through. Of course, many homeowners are reluctant to do so, and this is something banks are quick to take advantage of by offering much more expensive rates.

Shaun Donovan, Secretary of Housing and Urban Development, explained that the situation has led to what he termed “essential a monopoly on refinancing”.

“Whoever holds their current loan, whoever is the servicer, they can charge them—and we’re seeing this—very high fees,” he added.

According to the WSJ report, some homeowners are being charged by their banks as much as 0.53 percentage points higher than the going rate on refinanced loans in their area. Compare this to the Federal Housing Alliance, which charges Fannie Mae mortgage holders just 0.1 percentage points to refinance, and we can see there is a huge discrepancy.

Unsurprisingly, the likes of Bank of America and Wells Fargo insist that their refinancing options are competitively priced – however this hasn’t stopped the Obama administration from pushing for an amendment to HARP that would allow borrowers to refinance with other lenders much more easily.